China/Russia: Focus On Pipelines During Medvedev Visit

Presidents Medvedev (left) and Hu in Beijing (AFP)
A Chinese military band greeted Russian President Dmitry Medvedev upon his arrival at Beijing International Airport for a two-day visit.

Medvedev's talks with Chinese President Hu Jintao are seen as the focal point of his first trip abroad since he was sworn into office on May 7.

High on Medvedev's agenda is the issue of how to expand pipeline links so that Russia can sell and export more oil to energy-hungry China.

In the past, the two governments have discussed proposals to build new pipeline links -- including an extension of the eastern Siberia-Pacific Ocean oil pipeline into China.

Speaking to Chinese journalists on May 20, Medvedev indicated that he thinks a deal is close to being signed between Russia's state-owned oil firm Rosneft and the China National Petroleum Corporation (CNPC).

Medvedev is also expected to cultivate business relations in China in order to secure other potential trade deals. "It is obvious that Russia and China are large trade partners and our bilateral trade grows every year," he said. "I think our goal of reaching $60 billion and then $70 billion trade turnover annually is absolutely reachable."

The 42-year-old Medvedev arrived in Beijing from oil-rich Kazakhstan -- his first stop on the two-state tour -- where pipeline talks also figured prominently on the agenda.

Beijing has been working with Astana for a decade on the construction of a major pipeline that will link the oil fields and terminals in western Kazakhstan to western China.

At a joint press conference in Astana on May 22, Kazakh President Nursultan Nazarbaev confirmed that he and Medvedev spoke about how Russian oil could also be transported across Kazakhstan and into China when the final portions of that pipeline are completed.

"Most of Kazakhstan's oil and gas is exported via pipelines running through Russia," he said. "There is a reverse process too, and that is the transportation of Russian oil to China through Kazakhstan, which is planned for this year. Besides oil transit, our countries are cooperating actively in the development of Caspian oil and gas fields."

But, in fact, there also is competition between China and Russia for Central Asia's oil and gas -- which had been exclusively Moscow's preserve during the Soviet era.

There also is a rivalry in the defense sphere -- with some Russian officials reportedly worried that Beijing has been gaining too much access to Russian military secrets as a result of increased weapons sales to China.

Still, Moscow and Beijing have made efforts to try to align their positions in international diplomacy. And they have been cooperating on defense within the Shanghai Cooperation Organization -- a security group that also includes Kazakhstan, Uzbekistan, Tajikistan, and Kyrgyzstan.

Medvedev this week has emphasized Beijing's importance to the Kremlin as a partner on foreign policy. He told Chinese journalists that Moscow's foreign policy toward China should be "reasonable, pragmatic, and -- at the same time -- friendly and open."

"I'm sure that these talks will result in new, interesting projects and ideas and that the joint declaration that we will sign will also reflect our common positions on key issues in international affairs," he added.

Analysts say the fact that Medvedev's first official trip abroad is to Kazakhstan and China is a signal at a time when Moscow's relations with the United States and the European Union are rocky.

"He's going East, not West, thereby sending a signal that the East is more important than the West for Russia," says Masha Lipman, a Russia expert at the Carnegie Moscow Center. "I would say [the Kremlin is] not in a rush to send signals to the West that [it is] interested. I think, in fact, the current government is quite eager to improve Russia's image [in the East], at least as far as the investment climate is concerned."

Next week, Medvedev continues his travels with a visit to Germany, where he will meet Chancellor Angela Merkel.